More than three million U.S. couples own a small business together.
It should. Businesses started with a partner are more likely to survive. They also have a history of earning more income than businesses run by sole proprietors, which may help to explain why Silicon Valley entrepreneurs prefer to fund teams.
At Facebook, Mark Zuckerberg had Eduardo Saverin, Andrew McCollum, Dustin Moskovitz, and Chris Hughes. At Apple, the late Steve Jobs had Steve Wozniak. Google’s founding partners — Larry Page and Sergey Brin — have become known affectionately as the “Google twins.” Partnerships give small business owners greater resources and investors greater assurance.
Perhaps it should follow that working with a romantic partner would provide even more security, especially as you’ve pledged your lives to each other.
But even if your spouse is the love of your life, the one you can’t wait to spend every minute with, there are risks when starting a business a together. Ask these three questions before taking the plunge:
1. Do you complement each other at work?
You may be great at parenting kids together or planning romantic dates for each other, or you may make for a killer combo in your bowling league. But if you don’t have complementary skills for running a business, conflicts will inevitably arise.
Assess what each of you can and will contribute to your business before signing the paperwork. Typical pairings can include having one partner focus on administrative responsibilities, such as accounting and inventory, while the other develops and sells product.
Every successful business partnership benefits from the complementary strengths of its partners. How do you and your spouse bring different skills to the business relationship?
2. Do you trust your partner to do the work you’ll be doing?
I know, this sounds like an awful question to ask. But if you can’t say, honestly, that you knowyour spouse can do the work that will be required for your business to be successful, starting a business together is a bad idea.
Understand, too, that this is different from having faith. You’re a good partner — of course you have faith in your spouse. But if he wants to open a restaurant and you know he’s not that skilled a chef or doesn’t have deep managerial experience, you’ll be risking your livelihood —and possibly your happiness — on a long shot.
3. Are you ready and willing to take independent advice?
Finally, remember that a marriage is a legal entity recognized by the IRS for tax purposes. How you structure your business relationship — that is, whether your spouse is your employee or your partner in the business — has tax implications. Consult an accountant or financial advisor before setting up your mutual venture.
You may also want to consider getting a mentor who can help break the tie when the two of you disagree on one or more key business issues.
Choosing the right partner is a crucial step in starting and growing a business for the long term, but it’s also just one step. You will want to assess your target markets, make sure the work you’ve chosen will be a good fit for you personally, and develop a business plan to guide your efforts. Download our eBook, “Opportunity Knocks: How to Find and Pursue a Business Idea That’s Right for You,” now — and learn how to build a business that you and your spouse can enjoy and proudly make a success.